National College of Business and Arts Fairview, Quezon City S.Y.

2011 -2012

Submitted by: Ferrer, Ann Julian D. Flores, Bernadeth M. Galvan, Merrey Submitted to: Atty. Moises Dondoyano

Article 1416 When the agreement is not illegal per se but is merely prohibited, and the prohibition by the law is designed for the protection of the plaintiff, he may, if public policy is thereby enhanced, recover what he has paid or delivered. This article is an exception to the rule that where both parties are in pari delicto, they will be left when they are without relief. There are two kinds of contracts: 1. Those contracts which are illegal per se 2. Those contracts which are merely prohibited

Contracts which are illegal per se are those which are contrary to public interest, whereas contracts which are merely prohibited are those which are forbidden because of private interest. When the contract is merely prohibited the law allows the plaintiff to recover what he has paid or delivered provided that: 1. The contract is not illegal per se. 2. The prohibition by the law is designed for the protection of the plaintiff. 3. Public policy would be enhanced by allowing the plaintiff to recover. Pari delicto means both parties are equally guilty.

Example: 1. Records show that on January 20, 2007 a homestead patent was issued to Charles Soliven. On April 1, 2010, Soliven sold the homestead to defendants, Pete Abad the homestead from the defendants on the ground that the sale is void since it was made within the prohibited period of five years as enunciated in sec. 118 of the Public Land Law. May the heirs recover the parcel of land? Answer: Yes, the heirs of Charles Soliven may recover the parcel of land. The reason for the rule is that the policy of the law is to give land to a family for home and cultivation, consequently the law allows the homesteader to reacquire the land even if it has been sold, hence, the right may not be waived. The sale of the homestead in the case at bar is, therefore, null and void and the heirs have the right to recover the homestead illegally disposed of.

2. F, a Filipino, sold and delivered to c, a Chinese alien, a parcel of land for 100,000. Although both parties are at fault, the land delivered to C may be recovered. The rule is an exemption of the pari delicto rule because the act is not illegal per se but only prohibited. Public policy is hereby enhanced for if you will not allow recovery, the principle of conserving lands for Filipinos will be defeated. 3. F, a Filipino, leased his lot to A, an alien, for a period of 50 years during which F could not sell or otherwise dispose of the property and with A being given the option to buy it. This arrangement is a virtual transfer of the ownership to the alien in violation, of the public policy to conserve lands for Filipinos. Here, the Filipino is allowed to recover the property despite the fact that he and the alien are in pari delicto. Otherwise, such public policy would be defeated and it is continued violation sanctioned if the general rule on pari delicto is applied.

Article 1417 When the price of any article or commodity is determined by statue, or by authority of law, any person paying any amount in excess of the maximum price allowed may recover such excess. This article allows a person to recover what he has paid in excess the maximum price allowed by law. This is particularly true when, in times of emergency or calamity the Government, through the Price Stabilization Council, may fix the maximum selling price of commodities. The purpose of law is to curb the evils of profiteering. Example: 1. B buys from a Caltex station 100 liters of premium gasoline. The price per liter as regulated by the Energy Regulatory Board (ERB) is 37.00 per liter. If the price paid by B to the Caltex station was 7,500, he can recover the excess because the amount in excess of that allowed by law is recoverable. 2. Through the Price Stabilization Council, the Government pegged the ceiling price of a can containing 800 grams of edible oil at 30.00. A buyer who purchased such can of edible oil for more than 30.00 may recover the excess. 3. Suppose by Executive Order of the President the price of rice of a particular brand and quality has been fixed at 20.00. if a person pays 22.00 for it, he can recover the excess of 2.00.